An upswing in home prices and a surprising rebound in consumer confidence this week have economists buoyant about a possible turnaround in the national economy.

But for Sacramento? Not so much.

Sacramentans’ mortgage debt, the weakness of the commercial real estate market and a bleak outlook for California overall have tempered any bright spots for the local economy.

For example, Sacramentans are using credit cards more wisely but falling farther behind on mortgage payments, according to credit monitoring agency TransUnion. Housing market analysts, meanwhile, reported a rise in prices in recent months but also calculated that more than half the region’s homes are still underwater.

The contradictory data suggest an uncertain course to recovery.

“We predict things to get a little worse over the next 12 months,” said Ryan Sharp, director of The Center for Strategic Economic Research in Sacramento, which forecasts the region’s economy. “Sacramento isn’t going to outperform California.”

Delinquency to soar

After plunging more than 50 percent from the peak prices in some areas during the past three years, home prices have risen slightly over the past few months in all four counties in the Sacramento region, according to MDA DataQuick. In Sacramento County, home prices have gone up about 9 percent from the bottom median price of $165,000 in April.

But according to data released this week by First American CoreLogic, 51.1 percent of the region’s homeowners owed more on their mortgages than their homes were worth during the second quarter. The situation, known commonly as being “underwater,” means that an estimated $65 billion in property value is at risk of default, the company said.

Due to California’s high unemployment rate and a number of other factors that go into its economic models, TransUnion is predicting that the state’s mortgage delinquency rate, already one of the country’s worst at 9.7 percent, will soar to more than 14 percent by the end of the year, meaning one in seven homes will be at risk of foreclosure.

Sacramento’s mortgage delinquency rate has mirrored California’s over the past two years and stands at 9.6 percent. TransUnion predicts it will rise to 12 percent by year’s end.

“Historically, it’s been at 1 or 2 percent,” said Ezra Becker, director of consulting and strategy for TransUnion’s financial services group. Becker said Sacramentans’ mortgage problems are affecting spending habits.

“A lot of people took pay cuts, they were laid off or had to make other adjustments,” he said. “Despite all that, credit card delinquency still went down.”

That suggests people severely affected by the economy are choosing to keep their credit card balances lower — as the cards are often the primary funding source for necessities during a personal financial crisis — as opposed to paying down the mortgage on a house. Credit card debt per borrower in Sacramento peaked last year at $6,140, and has since dipped to $5,996. Mortgage debt, however, has remained almost constant at around $290,000 since late 2007 while delinquencies have soared.

Credit card lenders also have played a part, by aggressively lowering risks by trimming credit limits and declining to renew cards in some cases.

Risky commercial market

There is even less optimism in commercial real estate.

Banc Investment Group of San Francisco, which advises community banks, has been tracking commercial lending risk in more than 100 cities for the past two years using demographic, vacancy, rent and other information from multiple real estate companies. The company compiles a quarterly index of the conditions in most major American cities and released second-quarter figures this week.

All commercial property types in Sacramento plunged in the index, with retail and industrial properties faring the worst. Retail was at an index figure of 46.0 and industrial at 42.86. Multifamily and office properties were considered slightly less risky.

The index was benchmarked in 2007 on a nationwide basis, with a score of 100 representing average risk at that time.

“It’s one of the most difficult commercial real estate markets in the U.S.,” Chris Nichols, president and chief executive of Banc Investment, said of Sacramento. “It comes down to the macroeconomic principles of supply and demand.”

What was particularly alarming to Banc Investment was the probability of commercial real estate trading hands at deep discount.

“That’s all well and good for the buyer’s property, but what does that do for the neighbors?” Nichols asked.

But some say the tight credit market is beginning to loosen its grip.

Brokerage Marcus & Millichap, which specializes in apartment sales, claims moves by the Federal Reserve to free up credit will mean better lending conditions for borrowers into next year. William Hughes, managing director of the company’s capital markets group in Long Beach, noted that the market for commercial mortgage-backed securities — which supplied market liquidity that helped fuel the real estate boom a few years ago — has become much more attractive to investors. The price for CMBS bonds soared when credit markets froze last fall, and the market for them all but dried up.

Since then, however, the investments have become more reasonably priced. Large issuers of these bonds, such as the federal loan program Freddie Mac, are floating new deals. The prices haven’t returned to the heady days of free-flowing credit, which experts say was too low.

Hughes said the return of CMBS deals will eventually free up capital for more typical investors, though the effect will take time.

“There is no quick fix,” he said. “The trickle down comes as these deals help counter the supply and demand imbalance (in lending). Right now we have too few lenders in the marketplace.”

Marcus & Millichap credits Federal Reserve financing through the Term Asset-Backed Securities Loan Facility — originally slated to back credit card and auto loans — with spurring the CMBS market.

The outlook for Sacramento is a blow after the upbeat national announcements.

The Conference Board, a New York-based business research group, said Tuesday its consumer confidence index in August rose more than economists expected. Following that, Standard & Poor’s Case-Shiller Index of national home prices increased for the first time in three years, suggesting the housing bubble’s collapse could be at an end. The index increased 3 percent during the second quarter compared to the first — though it remains 15 percent lower than a year ago. Home prices increased in 18 of the 20 largest home markets, with only Detroit and Las Vegas reporting lower prices from May. Sacramento is not part of the index.

That hasn’t tempered the outlook for California. Each month, Arizona State University compiles a forecast using input from a number of sources, said Sharp, the Sacramento economist.